Kondratiev’s Works

Kondratievis best known as the source of the controversial concept of Kondratiev waves. Here I simply wish to note some related insights, which may still be valid even if his overall theory is wanting.

The Concepts of Economic Statics, Dynamics and Conjuncture (1924)

One might regard a system as static when its state is static. Instead, Kondratiev seems to regard a system as static when it has a static model. Thus a fixed deterministic dynamic system and a stationary stochastic system are both regarded as static.

5 Distinction between statics and dynamics

[The] dynamic approach considers economic phenomena as a function of the process of changes in the economic elements and the connections between these …

Thus if we used game theory as an analogue, a fixed game would be static, whereas changes in the game, as when coalitions form or reform, would be dynamic.

7 Types of Dynamic Process

[It is expedient to divide] dynamic processes into evolutionary processes (that is, nonrepeatable or irreversible processes) and wave-like processes (repeatable or reversible). By evolutionary or irreversible processes we understand those changes which, in the absence of abrupt external perturbing effects, take place in a specific single direction. As an example, we may point to the constant tendency for population size to increase …

This seems not quite right, but there does seem to be something in it.

6 Change processes …

Qualitative changes … only take on primary importance when the very nature of these [economic] elements changes, for instance when a flexible price becomes fixed or a market price becomes monopolistic.

It is not obvious that the impact of monopolies is to move things ‘in a single direction’, but we have some key concepts outlined, even if we may quibble with the detail.

Closer consideration of the facts shows that [the] overall tendency [of economic factors] to grow and develop is in itself (at least in a time period accessible to our analysis) an irreversible process which can only stop suddenly or be deflected as a result of perturbing factors or by cataclysms of a cosmic or social nature.

While we may find the finding outmoded, the caveat is worth considering.

12 Definition of conjuncture

[In] a favourable period of economic life one sees an increase in prices, … etc. Conversely, in an unfavourable period, one sees precisely the opposite changes in these elements. … This consistent fluctuation of changes in economic elements is not random. [They] are the result of the close relationship between these elements.

16 Conclusions

Along with his critics (e.g. Oparin) I interpret Kondratiev’s theory as there being notional equilibria around which economies cycle. This implies some form of stationarity at a higher level. We can accept this as a medium-term phenomena without supposing that more fundamental crises are impossible, perhaps even arising from ‘conjuncture’.

Basic Problems of Economic Statics and Dynamics

Part 1: Society and the economy

Ch.1: Population, Society and Social Phenomena

By a population … we mean a large number of particular elements. [By] virtue of the combination of a sufficiently large number of elements and events, the latter lose their chaotic nature and, on average, exhibit regular trends in their behaviour.

Taleb argues against this.

Ch. 2 The structure of society and base categories of social phenomena

[A] connection between people … which arises on the basis of particular forms of behaviour, may be more or less stable. … [Connections exhibit an almost unlimited scale of transition, ranging from the transient to the very stable and almost constant.

Part 2: Basic Questions of methodology in the study of social economy

Ch 5 Cognitive problems and problems relating to the method of social-economic science

[Concrete social-economic reality is immensely diverse and complex. In any given fragment it is already significantly more complex than external nature, since its individual elements are significantly more complex, diverse and concentrated.

[Causal] connection … is concerned with the relationship between phenomena, it is by no means always concerned with their numerical interrelationship, it is very often concerned with the occurrence of qualitatively new phenomena and, strictly speaking, it is never invertible.

[Causal] chains are not causally interrelated. They unfold as close, defined series. Imagine … that two or more such causal series intersect in space and in time or even in time alone. As a result of this intersection X occurs. It cannot be explained or understood based on just opne of the ontersecting causal series … it cannot be understood objectively … .

Irregular events whose causes cannot be determine din the scientific sense of the word at the given state of scientific analysis and its resources, will be said to be random.

Ch 7 Nature of the regularity of economic life and the problem of nomography and idiography in the social-economic sciences

Any law is valid only when specific conditions are present. The formula for a law may not contain these conditions … it always presupposes the presence of these conditions and thus cannot always be explicitly expressed.

[Bernoulli’s theorem and the law of large numbers] acquire theior full value and a close connection is established between their assertions and reality only if the statement that unlikely events are actually rare or, conversely, that likely events are actually frequent and typical, is legitimate.

The regularity of phenomena … is manifest to the extent that the law of large numbers is in force.

[If the] general causes change, the probability of the event changes and its regularity changes.

[It] is completely possible that some, if not all, of the regularities of these phenomena are different in the different phases of their evolution.

[Any] regularity is always only probable.

[Although] in the area of socio-economic phenomena we are dealing with a large number of unitary events, and although we can consequently, form a vast population of these, nevertheless, the law of large numbers here in practice does not involve a large number of events [large enough].

[The] general conditions of the life of society and th nature of the elemnts (individuals0 of which it is made up, change with the course of time, i.e. historically, These changes may be and sometimes are sometimes so radical in nature that the unitary events of different historical epochs may not even be elements of the same populations … .

Ch 8 Categories of the absolute and the obligatory in the social-economic sciences

[A] value judgement, although it presupposes at least one connecting theoretical judgment, in the final analysis has a logical structure which depends on some initial standard. … What precisely are these standards?

Ch 9 Economic statics, dynamics and genetics

A static economy bears only a remote resemblance to reality, it represents only a schematic abstraction.

[The] phenomena of changes in economic conditions and, hence, in the economy itslf are not compatible with the idea of passive adaptation of those involved in economic activity who generate new combinations.

[A] stat of equilibrium is a limiting state of the economy, which is only possible under specific conditions and which is expressed via specific relationships between elements of the national economy which are inherent to the state of equilibrium.

The equilibrium of a system of elements … is that state of them for which they do not exhibit internal tendencies for change in their elements or relationships.

[In]concrete reality, we never find a national economy in equilibrium anywhere. But what we inevitably find and observe in reality is a tendency of the system of elements we are analysing towards equilibrium. [At] any given time these effects come up against counter-effects. {any interference … disrupts these tendencies, however it also inevitably leads the generation of a new initial position for the system of economic elements, based on which this system will exhibit new trends towards an equilibrium state.

[The] equilibrium of a given system of connected, symmetrically arranged economic elements is that state of the latter, for which, under the given conditions, no internal trends for change are observed in the above elements and the relationships.

[In studying equilibrium statics cannot and does not study the class of economic phenomena whoise economic essence amount s to a rejection of equilibrium or a violation of it or which are the consequences of a lack of equilibrium. These include, for example, the phenomena of crises, industrial profits, etc.